August 7th, 2018 Mortgage Industry Update

The Bank of Canada announced on July 11th that it’s overnight lending rate will increase to 1.50% from 1.25%. The prime rate thus increases to 3.70% from 3.45% with most lenders. The common prediction remains that there will be no further rate increases for the remainder of the year.

Additionally this week:
– BILD: Sales of new single-family homes fell 19% year-over-year in June, and were 71% below their 10-year average. The benchmark price of a low-rise home fell 9.4% year-over-year to $1,132,957. Benchmark price of new condo coming in at $774,554, 23.5% jump from this time last year.

– Nearly 60 per cent of Canadians have changed their behaviour by doing things such as cutting back on spending on both extras and essentials to brace themselves for rising interest rates, a new survey from Manulife Bank suggests.

– Altus Group report: 2017 was a booming year for Canadian residential renovation spending, which grew a record 4.2% year-over-year to $77.7 billion. Renovation spending has been achieving a higher rate of growth than the overall economy since 2014.

– CMHC: Country’s housing sector is facing a high degree of vulnerability to market instability for the eighth straight quarter. The Crown corporation attributes the vulnerability to overvaluation and price acceleration in Toronto, Vancouver, Victoria, and Hamilton.

– CBRE: 28,900 technology jobs were added in 2017 in Toronto, a rise of 13.6% from the previous year. 52% jump over past 5 years. Continues to outpace other North American markets – ranks 4th in top 5 markets for tech talent in 2018. Was the fastest-growing tech-jobs market in 2017.

Stay tuned for the next update!

For any questions and concerns please do not hesitate to call Harpreet Singh The Mortgage King at (416) 795-1919.